daver

Battle of the Building Material Makers: Owens Corning vs. USG Corp.

Regarding PRS I think you are totally missing the point. Market prices on PRS's liabilities reflect somewhat of a market view of the fair price of the risk that they are carrying. When prices fall it means that either expected default rates are increasing or the price of such downside risk has become more expensive. Either way, the value of those contracts is now lower and could be replaced at more favorable prices by competitors.

Additionally, I would not want to rely on the company to give me an unbiased and accurate view of the likelihood of their current contracts costing them a lot of money. All of their incentives point in the other direction. I would be a bit suspect if there is a large gap between what the market is implying and what their management is telling investors.

Battle of the Building Material Makers: Owens Corning vs. USG Corp.

Paul, the appeal would be grounded in the likely cash flows available to USG in years to come. This may come as a surprise to you, but the majority of a company's value is usually not totally captured in the next 2 years of earnings.